On July 22, the Senate Health, Education, Labor & Pensions (HELP) Committee held a hearing entitled, “The Right to Organize: Empowering American Workers in a 21st Century Economy.” This hearing centered around the PRO Act, the maligned federal legislation which would essentially eliminate the successful independent contractor model in the trucking industry. TCA and our industry partners have vocally opposed the PRO Act, and we have taken the time to carefully explain to members of Congress why this legislation would be detrimental to truckload carriers.
During the hearing, Sen. Mike Braun (R-IN) strongly stood on the side of small businesses. He raised many concerns about the PRO Act, most notably that the entrepreneurial independent contractor has actively chosen to be a small business owner and that the government should not infringe upon that right. He also explained that, as a small business owner himself, he experienced difficulties operating in the state of California due to their overly restrictive labor rules.
TCA firmly believes the trend of California-specific legislation becoming the national standard must end. This is especially true for CA AB 5, which codifies the ABC test as the standard for determining employment status. The “B” prong of this test, which says that an independent contractor’s work must take place outside the usual course of the business, is completely unworkable in trucking.
The California Trucking Association is asking the Supreme Court to make a final determination on whether AB 5 should apply to trucking. But while the case proceeds, several truckload carriers have already stopped using independent contractors in California. As Senator Jerry Moran (R-KS) pointed out during the HELP Committee hearing, AB 5 was amended to provide a vast number of industries and a wide range of different types of workers with an exemption from the law. The PRO Act currently contains no exemptions.
The major takeaway from the hearing was that the PRO Act continues to be a partisan bill which was crafted with no input from the community to which it would apply. Fortunately, as Sen. Braun explained, there is no way for the PRO Act to pass through Congress this year. While TCA is clearly opposed to bad actors within the industry taking unfair advantage of the independent contractor model, this form of work serves as the backbone of truckload. Some of the most successful truckload carriers today started with one enterprising individual buying one truck and growing their business from there. Any threat to this model moving forward must be opposed, or the entire economy will suffer.